Is a DBA an alternative to Starting an LLC?
Tags: dba, limited liability company, sole proprietor, starting an llc
No. A DBA (which is short for doing business as) is a filing made at either your local or state level which registers a name for you to conduct business under. If a person files for a DBA and operates a business under that DBA, this is setting up a sole proprietorship structure.
The DBA is merely a name registration. It is not a separate legal entity and it does not offer any liability protection whatsoever. All it does is make it permissible to use such name in connection with your business.
The major reason for starting an LLC is to protect yourself and your personal assets from business related problems and liability. When you form one, you will need to file an LLC name for your business. This name must be available in your state of formation for use as an LLC name.
Now, some businesses want to use another name or several names when running their business. An LLC can file and register for a DBA if it desires to use other names.
In summary, a DBA is totally independent and unrelated to the use of an asset protection entity like a limited liability company for business. It does not offer the liability protection, tax flexibility, or professional and official image that the use of a separately organized entity will give you.
